Cargo Insurance

1. Cargo Insurance

2. Cargo Insurance • Cargo insurance (also known as marine cargo insurance) will cover you for the risks involved in transporting goods by all modes of transport and for every stage of the movement. • A cargo policy will indemnify against loss or damage to the goods being shipped as a result of an event insured against in that policy. • Responsibility for insurance for a particular transaction can rest with both parties or just one, depending on the agreement.

3. Cargo Insurance • The Incoterm negotiated will define at which points the responsibility of both parties begin and end and who will be liable for losses or damages to the goods • The international conventions and regulations that govern carrier liability actually limit their liability to relatively low values • There are a number of different types of cargo insurance policies. The two most common ones are: • An individual shipment policy • An annual or open policy

4. Cargo Insurance • The most common type of claim is one that arises from the partial loss of the goods during the voyage covered by the policy. • A total loss can be either an actual total loss or a constructive total loss • ‘General average sacrifices’, are proportioned among all of the parties involved in the shipment, including the ship owner and the cargo owners.

5. Cargo Insurance • Events or perils insured against are indicated on a policy by the inclusion of specific clauses developed by the Institute of London Underwriters. These are: • Institute Cargo Clauses ‘C’ (minimum coverage) • Institute Cargo Clauses ‘B’ (medium coverage) • Institute Cargo Clauses ‘A’ (maximum coverage) • Institute War Clauses and Institute Strike Clauses provide additional coverage